We are seeing more and more marketers turning to email in order to better connect and engage with their customer base. Why email? More marketers are attracted to email because of the tremendous amount of data it delivers – data that other digital channels can’t offer. As a result, we felt a primer on basic email marketing metrics could be helpful to those marketers new to email marketing.
Here are 5 fundamental metrics that are an excellent gauge for subscriber behavior marketers need to be aware of. Please note that this summary is for beginners, so experts should already be well versed in all of these.
- Open Rates (OR)
Definition: the number of recipients who opened your email, usually as a percentage of the total number of emails you sent out.
Use: While open rates are a good metric to use to measure and benchmark subscriber engagement, they only show that recipients have viewed an email message in their inbox, which doesn’t always tell the whole story. Open rates indicate only the number of emails opened from the total amount sent, not just those that were actually delivered. Another point to keep in mind is that open rates are generally tracked using an impression pixel. If a subscriber’s email client doesn’t automatically download your images then it won’t register as an opened email.
Smart Marketer Tip: It is important to note that there are often differences in measurement methodologies, which explains why some ESPs often report higher open rates (i.e. some ESPs use total or “gross” opens instead of unique opens which skews their OR upwards). It is important that marketers keep this in mind when comparing the metrics of competitors within their industry and set benchmarks using their own data.
The calculation for open rates is OR% = (confirmed unique opens)/(sent messages – bounces).
- Click-Through Rate (CTRs)
Definition: the percentage of clicks for a particular email based on the number of recipients who actually opened the email.
Use: CTRs are an excellent measure of engagement and indicate the relevancy of email content. Leading marketers often conduct AB testing to uncover which template designs and calls-to-action generate the most clicks.
Smart Marketer Tip: CTRs can be slightly inexact because some clicks “get lost” between the click and your server. Be sure to ask your ESP if the CTR is unique, meaning that each individual user is only counted once no matter how many times they click on a link.
The calculation for click-through rates is CTR% = (total clicks)/(sent messages – bounces).
- Conversion Rate
Definition: the percentage of recipients who clicked on a link within an email and completed a desired action. A conversion could be a monetary transaction, a download, a webinar sign up, or an email newsletter opt in.
Use: Conversion rate is the ultimate measure of an email campaign’s effectiveness. The higher your conversion rate, the more relevant and compelling the offer was for your audience. However, conversion rates are dependent on other factors, such as the effectiveness of your landing page.
- Bounce Rates
Soft Bounce Definition: email sent to an active email address but which is turned away before being delivered. Often, the problem is temporary and as a result of the server being down or the recipient’s mailbox is full. The email might be held at the recipient’s server and delivered later, or the sender’s email program may attempt to deliver it again.
Hard Bounce Definition: a permanent reason why an email cannot be delivered to an email address. Reasons for hard bounces include:
- The recipient’s email address does not exist
- The domain name does not exist
- The recipient email server has completely blocked delivery
Use: Email records that hard bounce should be flagged and suppressed immediately. Failure to remove hard bounces from future email campaigns can severely hurt your sender reputation and your ability to get emails delivered to the inbox.
The calculation for Bounce Rates is: BR% = (Hard Bounce + Soft Bounces)/(sent messages)
- Unsubscribe Rate
Definition: When users manually opt-out from receiving all future messaging from a specific brand or company. Subscribers are most likely to unsubscribe when:
- They receive impersonal and irrelevant email
- They don’t recognize the sender
- They receive more email than they expect or want
Use: While unsubscribe rates are typically low at 0.2% per mailing, it is an important metric to pay attention to, as it provides good insight into what type of content subscribers value or, in this case, don’t value.
Looking for more info on email marketing metrics?
For more information on how to get more from your email campaigns, download Inbox Marketer’s 2015 Email Marketing Benchmark Report.